1/22/2015
SAO PAULO – Brazil’s ethanol industry, struggling due to droughts and government policy decisions, hailed plans to raise gasoline taxes, while the biodiesel sector said Wednesday it will raise production by 25 percent in 2015.
Finance Minister Joaquim Levy said Monday the government will restore a fuel tax and another levy on diesel that had been eliminated in recent years, an announcement welcomed by the president of the governing board of the Brazilian Sugarcane Industry Association, or Unica, Roberto Rodrigues.
The government made the moves as part of a budget-balancing effort.
In statements to O Estado de Sao Paulo daily, the former agriculture minister said the measures “make the industry more competitive,” although he cautioned that more initiatives are needed, including raising the mandatory proportion of ethanol in the gasoline mix from its current level of 25 percent.
The ethanol sector wants that required amount raised to 27.5 percent per liter of fossil fuel gasoline.
Existing supplies of ethanol, made in Brazil from sugarcane, are sufficient to cover demand through April, when the 2015-2016 harvest – projected to be more abundant than the current one – gets underway, Unica says.
Separately, representatives of the ethanol sector are scheduled to meet at the end of this month with the governors of Brazil’s nine producing states (Sao Paulo, Rio de Janeiro, Minas Gerais, Goias, Mato Grosso do Sul, Mato Grosso, Pernambuco, Alagoas, and Parana) to discuss a possible reduction of a tax on that biofuel.
“The current government has taken a big step by resuming dialogue with the sector,” said Rodrigues, who promoted the ethanol industry as the agriculture minister of Luiz Inacio Lula da Silva, current President Dilma Rousseff’s mentor and predecessor.
Ethanol is a major transportation fuel in Brazil, where more than 90 percent of new cars are “flex-fuel” vehicles that can run on ethanol, gasoline or any combination of the two.
Separately, Brazil’s Abiove vegetable oil association said biodiesel output will rise 25 percent this year.
The law, which the sector expects will be modified, requires a 6 percent biodiesel mix in Brazil’s diesel fuel, a low proportion compared to countries such as Argentina, where the mandatory level is 10 percent.
Brazil posted record biodiesel consumption in 2014, with 3.27 billion liters blended with traditional diesel fuel, up nearly 15 percent from 2013.
source
SAO PAULO – Brazil’s ethanol industry, struggling due to droughts and government policy decisions, hailed plans to raise gasoline taxes, while the biodiesel sector said Wednesday it will raise production by 25 percent in 2015.Finance Minister Joaquim Levy said Monday the government will restore a fuel tax and another levy on diesel that had been eliminated in recent years, an announcement welcomed by the president of the governing board of the Brazilian Sugarcane Industry Association, or Unica, Roberto Rodrigues.
The government made the moves as part of a budget-balancing effort.
In statements to O Estado de Sao Paulo daily, the former agriculture minister said the measures “make the industry more competitive,” although he cautioned that more initiatives are needed, including raising the mandatory proportion of ethanol in the gasoline mix from its current level of 25 percent.
The ethanol sector wants that required amount raised to 27.5 percent per liter of fossil fuel gasoline.
Existing supplies of ethanol, made in Brazil from sugarcane, are sufficient to cover demand through April, when the 2015-2016 harvest – projected to be more abundant than the current one – gets underway, Unica says.
Separately, representatives of the ethanol sector are scheduled to meet at the end of this month with the governors of Brazil’s nine producing states (Sao Paulo, Rio de Janeiro, Minas Gerais, Goias, Mato Grosso do Sul, Mato Grosso, Pernambuco, Alagoas, and Parana) to discuss a possible reduction of a tax on that biofuel.
“The current government has taken a big step by resuming dialogue with the sector,” said Rodrigues, who promoted the ethanol industry as the agriculture minister of Luiz Inacio Lula da Silva, current President Dilma Rousseff’s mentor and predecessor.
Ethanol is a major transportation fuel in Brazil, where more than 90 percent of new cars are “flex-fuel” vehicles that can run on ethanol, gasoline or any combination of the two.
Separately, Brazil’s Abiove vegetable oil association said biodiesel output will rise 25 percent this year.
The law, which the sector expects will be modified, requires a 6 percent biodiesel mix in Brazil’s diesel fuel, a low proportion compared to countries such as Argentina, where the mandatory level is 10 percent.
Brazil posted record biodiesel consumption in 2014, with 3.27 billion liters blended with traditional diesel fuel, up nearly 15 percent from 2013.
source
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